Coarse grains prices move up; New labeling law for processed chicken

Coarse grains prices move up

Coarse grains prices have moved up again this week in India. Even though there is a slow down and demand may be down, prices are not coming down.

Maize prices pan India average moved up by 1.6% against last week to Rs.8230 per MT at the market yard. On the average the prices may be less than the Minimum Support Prices (MSP) of Rs.8400 per MT, but in several markets prices are much higher than the MSP. The prices are 13.3% higher than the prices last year. Also prices are higher by 8.47% against prices in the first week of Jan 2009. The average price of maize in Jan 2009 at the Market yard is Rs.7975 per MT, which is 12.75% higher than Jan 2008. The price is also higher than Dec 2008 by 2%.

In the future markets, maize prices have slid down by 3-5% for Feb – Apr delivery, while in the spot markets, of Nizamabad and Karimnagar, prices moved up by 1.2% and 1.6% respectively.

Pearl Millet (Bajra) prices have also increased by 6.9% to Rs.8121 per MT. Added 5% since first week of Jan 2009. Against last year the price is higher by 19.8%. Against maize the price is lower by 1.4%. Jan 2008 average price of Pearl Millet at the market yard is Rs.7890 per MT, which is 19.5% higher than Jan 2008 average price and 3.2% higher than Dec 2008 price.

Grain Sorghum (Jowar) prices also moved higher by 3.8% to Rs.9776 per MT, added 10.35% since the first week of Jan 2009. Prices are higher than last year by 2.6% and 15.8% against maize. Average prices of sorghum for Jan 2009 is Rs.9339 per MT, just 1% lower than Jan 2008 price but 3.3% higher than Dec 2008 average.

Barley prices this week moved down on the average to Rs.8975 per MT against last week, but are higher than first week of Jan 2009 by 7.44%. The prices are 17% lower than last year’s prices. Jan 2009 prices averaged Rs.8920 per MT at the market yard, about 12% lower than Jan 2008, but 0.5% higher than Dec 2008 prices. GOI also declared the MSP for barley, which will now be Rs.6850 per MT, an increase of 5.3% against last year.

In the futures market, barley prices gained Rs.470 per MT, (+5.3%) for Apr delivery. Also in the spot market in Jaipur the prices moved up by 4% against last week.

Corn prices on CBOT for Mar delivery were down by 3% to $149.20, May delivery down by 2.79% to $153.61. The FOB value of corn (US Gulf) for Mar – May is indicated at $174-175 per MT. Based on the freight costs, the corresponding CNF value of corn in the region (SEA/India) would be $200 – 205 per MT for May-July period, taking 45-60 days delivery period.

New labeling law for processed chicken

The new labeling law notified under the Food Safety And Standards Authority (FSSA), will be a boon for the chicken processing sector. Based on the new law, that becomes effective from Mar 19, 2009, processors will be able to put in “USE BY DATE” on processed chicken, though this would be only for those products that have a shelf life of less than 7 days.

The notification can be seen on the website of Ministry of Health and Family Welfare (follow the link below).
http://www.mohfw.nic.in/Noti%20664.pdf

The U S Grains Council, through its various discussions with the industry has been advocating the change in terminology from “date of manufacture/date of expiry” to “use by date.” While it is a step forward in India and will help the processors and consumers alike. In US the industry can use the terminology “Sell-By or Freeze by date”. This is only possible when the infrastructure is fool proof and there is a recall procedure. In additional it is important that the dealers and retailers are trained to handle the product.

Amit Sachdev
India Representative
U S Grains Council
usgcindia@gmail.com

Coarse Grains prices move up

Coarse Grains prices move up

Maize prices at the market yard on an average moved up to Rs.8100 per MT, adding 1.5% to the last week’s prices. The prices were 13.3% higher than last year’s prices at the market yard. Delivery prices across the country are going up. At the consumption centers e.g., Gujarat Rs.9400 per MT; Maharashtra Rs.8900 per MT; Andhra Pradesh Rs.8800 per MT; Uttaranchal Rs.10700 per MT. Reports of export deliveries to Bangladesh and Pakistan @ 210 – 220 per MT have possibly caused the increase in prices.

In the futures market corn prices have moved up across the board by 4.5 - 4.7%, adding about Rs.400 per MT over previous week’s prices. Even in the Spot markets of Davangere, Karimnagar and Nizamabad, the prices moved up by 2.6 – 3% over last week prices.

Pearl Millet (Bajra) prices have moved downward to Rs.7595 per MT, a loss of 6.3%. The prices though remain higher than last year’s values by 13.2%. Against maize, the price of Pearl Millet at the market yard was down by 6.6%.

Sorghum (Jowar) prices have added 1.2% to the prices, averaging Rs.9415 per MT at the market yard The prices are 4.7% lower than last year’s prices, but remain 14% higher than maize prices at the market yard.

Barley prices averaged Rs.9373 per MT, adding 4.4% to the values. The prices have move up by 1% against last year’s prices. In the Spot market, the prices moved up by Rs.400 per MT to Rs.8900 per MT, adding 4.7% to the tally.

Reports are that drought is Argentina is more serious that previously thought. The country agriculture office has projected corn production to fall to 15.5 MMT against 20.85 MMT produced in 2007/08, a drop of 25%. USDA had reported a production estimates of 16.5 MMT in Jan 12, 2009 report. Exports are likely to be anywhere between 6-9 MMT, down from last year’s 15 MMT Farmers, who until four months back were protesting against the export tax, not are looking towards to government to give them some relief. Soya crop as per reports may not be as badly affected, but production is expected to be 41-42 MMT, against 46.2 MMT last year, a drop of 11%. This may help the prices of corn and soybean to move up in the world market.

On CBOT, corn closed at same pries as last week for the Mar $153.69; May $158; Jun $162.19 per MT. FOB values (UD Gulf) were indicated in the range of $177 – 180 per MT, While Sorghum FOB US Gulf was indicated at $164-168 per MT. DDGS prices to SEA region were $210 per MT.

Amit Sachdev
India Representative
U S Grains Council
usgcindia@gmail.com

Coarse cereal prices move up; Use Bio-degradable PLA instead of petro plastic – Delhi enacts the law

Coarse cereal prices move up

The week was attributed to the harvest festivals across the country. North India celebrated Lohri, the south celebrate Pongal and east Bihu. The week also saw increased prices of all coarse cereals, possibly picking of demand from poultry and starch sectors. But arrivals are not as strong.

Corn prices moved up by 5.2% over last week to Rs.7980 per MT at the market yard. Against last year the prices are higher by 9.5%. In the futures market, the prices for jan delivry were down by about 2% against last week to Rs.8100 per MT, While for Feb and Mar delivery the prices moved up by 1% and 3.5% respectively. In the Spot markets, while prices were stable as last week in Nizamabad and Karimnagar, prices increased by 1.3% by the end of the week in Davangere to Rs.8064 per MT.

Pearl Millet (Bajra) prices moved up by 4.8% over last week, to Rs.8100 per MT. Prices were 18.3% higher than last year and against maize, the prices were higher by 1.5%.

Sorghum (Jowar) prices also were Rs.9300 per MT, moving up by 5% against last week. Prices were higher than last year by 4.7%. Against maize, the prices were higher by 14.7%.

Barley prices also moved up by 7.5%, to Rs.8980 per MT at the market yard. Prices though were lower than last year by 11%. In the Jaipur market prices moved up this week by 5.8% to Rs.9000 per MT.

On the CBOT it was a traumatic week, Prices slumped at the start of the week to $150 per MT for march delivery and as the week went by the prices were down to $144 per MT. On Friday close, corn has regained some strength as closed at $153.92 per MT for march delivery, but still 4.73% lower than last week’s close. For May and July delivery too, corn closed at $158 and 162.3 per MT, lower by about 5.65% and 4.31% respectively.

One of the reasons attributed for this dip is prices is the USDA report out on Jan 12, which projected an increase in the ending stocks to 45.46 MMT, against last month’s projection of 37.44 MMT. Food/Seed/Industrial use is also reduced from 127.88 MMT to 124,46 MMT. Use in Ethanol is down from 92.98 MMT to 91.44 MMT. As the local availability is expected to increase, putting pressure on prices.

Corn prices FOB US Gulf were indicated at $167/168 per MT for Feb – May delivery, while Sorghum FOB Gulf were lower at $153/159 per MT for Feb-may delivery.

DDGS prices in the Asian region were reported at $208/210 per MT. There are indications that the demand of DDGS will be increasing as the container freight rates are coming down and the high cost inventories accumulated earlier get reduced over a period.

Freight rates for bulk commodities have remained stable in the region, USG Gulf China is reported at $23 per Mt, while US Gulf-Egypt is reported at $13 per MT for 55,000 ton ship loads.

Use Bio-degradable PLA instead of petro plastic – Delhi enacts the law

Government of Delhi has banned the use, production and storage of plastic bags in Delhi with immediate affect. Earlier also the ban was notified, but bags of 40 microns were allowed.

The ban follows a Delhi High Court order based on the report by Chopra Committee. Erlier when the ban was implemented, 40-micron limit was applicable more to manufacturers, but now the idea is everyone using only BIO-DEGRADABLE BAGS and nothing else.

The notification can accessed using the link given below
http://environment.delhigovt.nic.in/pdf/Notification_PlasticBags.pdf

The notification dated Jan 7, 2009 is effective immediately and for this the Government of Delhi has amended the Act of 2000 to Act of 2008.
http://environment.delhigovt.nic.in/pdf/plastic%20amendment.pdf

Other cities which have banned use of bags are Chandigarh, which on October 2, imposed a complete ban on use and manufacture of polythene and plastic carry bags. Puducherry administration has decided to ban use of plastic materials in the Union Territory from July 2009 in a phased manner. A report indicated that plastic products such as carry bags and cups were responsible for choking of drains and sewage canals in and around Puducherry region, which caused the recent floods.

Another report indicates, that the plastic bag we using to carry that loaf of bread, butter, vegetables and other groceries represents 12 % of the world oil production. percent of the world oil production. The plastic bags take hundreds of years to decompose and also release toxic substances in the ground, creating more pollution.

While it may be good idea, alternatives have to be thought. Everything can not be put in cloth bag or a recycled paper bag. For food and other stuff, a container will be needed and these could be made out of Poly Lactic Acid (PLA), from corn.

PLA based products have been used extensively in Taiwan and Japan. A company in Taiwan has invested for laminating paper with PLA and has named it “Pland Paper” a literal combination of PLA and paper, is the first ever 100 percent PLA coated paper made without any additives, making it 100 percent biodegradable.

As per the U.S. Grains Council office in Taiwan, the “Pland Paper” carries the same characters as traditional polyethylene coated paper, including its ability to withstand heat which makes it suitable for enduring hot coffee, hot tea, hot noodle soup, etc. Since it is a biodegradable product as opposed to petro product, it can be used without any problems in the food sector as well.

Mobile companies are not far behind and are moving in the direction of using PLA. Samsung has launched an eco-friendly phone, W510, which is claimed to be Samsung's first mobile phone with 'bio-plastic' made from natural material extracted from corn. Nokia is also planning to launch around 40 new phones made up of biodegradable components that can be easily recycled. They will also using phone covers that are bio-degradable.

Amit Sachdev
India Representative
U S Grains Council
usgcindia@gmail.com

Coarse Grain prices down in India; Registration of farms/animals - an important aspect of livestock farming

Coarse Grain prices down in India

Maize prices moved down this week by 1.4% and averaged Rs.7590 per MT at the market yard. The prices are higher than last year by 7.7% against last year. GOI reports suggest that the area under Rabi maize is up by 2.15% to 0.90 million hectares against last year’s 0.883 million hectare. The land under maize is also up against five year’s average by 12.46%.

In the futures market, maize has move up by Rs.260 – 370 per MT from Rs.8000 per MT value last week, closing at Rs.8260 per MT for Jan delivery to Rs.8370 per MT for Mar 2009 delivery, an increase of 3.25% to 4.62%. While in the Spot market in Nizamabad, prices have been stable at Rs.8160 per MT, In Davangere prices have slumped to Rs.7960, a loss of 1.1%, In Karimnagar, prices moved up marginally to Rs.8200 per MT.

Pearl Millet (Bajra) prices have been stable this week at Rs.7740 per MT at the market yard. The prices are higher than last year by 14% and against maize the prices are higher by 2%.

Sorghum (Jowar) prices have slumped this week by 12.5% to Rs.8860 per MT at the market yard. The prices are also lower than last year’s price by 8.7%. Against maize though the prices are higher by 14.3%. As per GOI reports, area under sorghum in Rabi season is up by 10.85% to 4.842 million hectares from last year’s 4.368 mill hectares. The area though is lower than the five year average of 4.911 million hectares by 1.4%.

Barley prices have slumped by 8.7% against last week’s to Rs.8355 per MT. Against last year the prices are down by 27%. Area under Barley is up by 13.85% to 0.764 million hectares against 0.671 million hectares last year in Rabi season. The area is also higher than the five year’s average of 0.644 million hectares by 18.63%.

In the International markets, corn prices have remained stable, as reports are that China is expected to produce 165.5 MMT of corn in 2008/09, up 9.5 MMT from last estimates of 156 MMT. Also there are reports that Argentina may produce only 16.5 MMT of corn in 2008/09 and would be able to export only 9 MMT of corn. Brazilian corn production has also been reduced to 52.3 MMT for 2008/09, a reduction of more than 2 MMT. The reason for a lower corn production in Argentina and Brazil is the prolonged drought in the area, which is effecting productivity.

On CBOT, March corn closed just about $0.71 per MT lower than last week at $161.56 per MT, while May corn was up by $1.48 per MT to $167.78 per MT. Jul corn was quoted at $169.67 per MT on CBOT. FOB values of corn (US Gulf) was $182/183 per MT, while Sorghum was quoted 410 lower than corn at $172/174 per MT. DDGS prices have also come down and delivery in region (SEA) is indicated at $207/208 per MT. Freight rates remain stable at US Gulf – Japan at $23 per MT, while US Gulf – China is quoted at $21 per MT for handymax size.

Registration of farms/animals - an important aspect of livestock farming

The chicken, turkey and egg associations in US namely National Chicken Council (NCC), National Turkey Federation (NTF) and the United Egg Producers (UEP), have urged farmers to register their farm premises where birds are housed under the National Animal Identification System. The registration will help the government to track diseases, give prompt services and help protect the livelihoods of the animal farmers.

For India, though it will not only be able to counter the disease threat in unorganized sector, but the registration of farms will help provide a correct picture of placement of stocks (broilers and layers) at various locations, It will also enable the farmers/traders to know precisely the demand and supply of feed ingredients, vaccines and medicines that may be required in the area. In addition the registration will ensure that no new farms comes in close proximity and the disease threat can be minimized in the long run.

It is not only the poultry operations that need to be registered, other animal farms, namely dairy, swine etc, must also follow the same route. Animal Identification for loans, insurance and countering disease outbreaks. This in addition to will assist in identification and selection of best of the animals in certain areas, which can be bred or selected for traits. Egypt is working on these lines and USGC is assisting the Buffalo Association to register animals on milk production. The best of the animals and its progeny is thus identified and it is easy to keep the germplasm intact and other farmers/areas to benefit from the same.

Amit Sachdev
India Representative
U S Grains Council
usgcindia@gmail.com

Maize is stable, other coarse grain prices move up in Indian market

Maize is stable, other coarse grain prices move up in Indian market

Maize prices remained stable in the last week of the year at about 7650/7700 per MT range, though the prices were higher than last year by about 9.2% for the last week of the year. The month average for maize for Dec 2008 at the market yard (loose stock) is about Rs.7815, which is 15% higher than last year, but 4% lower than Nov 2008 levels.

The average prices are down from the peak in Aug 2008 (Rs.8900 levels at market yard) by about 12.32%, which is boon to the poultry farmers. The cost of Soybean meal on the other side has not come down and are currently at Rs.16000 per MT delivered at some mills. The cost of production thus is still at Rs.39-42 per kg of chicken. As there has been a lower placement of parent stock and corresponding commercial broiler placement, the price of live broiler in South India was ruling at close to Rs.56-58 per kg.

In the futures market (NCDEX), the prices have moved up by close to 2.36% for near month delivery (Jan – Mar) over last week values. The prices though remain at Rs.8000 per MT, about 4.76% lower than the MSP announced by GOI. In the Spot markets of Nizamabad and Karimnagar the prices moved lower by 1.5% against last week prices to Rs.8160 per MT., while in Davangere the prices were close to Rs.8050 per MT range.

Pearl Millet (Bajra) prices have also remained stable at Rs.7750 per MT range, but are higher than last year by 14.8%. The prices are higher than maize by 0.6%. The monthly average was at Rs.7650, about 15.4% higher than last year and about 1.7% higher than Nov 2008 for market yard prices.

Sorghum (Jowar) prices have moved up by about 23.5% to Rs.10,120 per MT. prices are 8.5% higher than last year and about 24% higher than maize. Average month pries was s.Rs.9036, about 6.5% lower than last year, and o.5% lower than Nov 2008 for market yard prices.

Barley prices added 9.7% to the tally this week, averaging Rs.9150 per MT, but remained lower than last year prices for the last week of the year by 12.8%. Monthly average prices were Rs.8870 per MT, about 13% lower than last year and 4.3% lower than Nov 2008 levels. The prices for Dec 2008 are lower than the peak average prices in Jun 2008 (Rs.11253) by about 21% for market yard prices.

The spot prices of barley at Jaipur moved down by 4.76% to Rs.8725 per MT. while in the futures the prices for April delivery remained unchanged at Rs.10442 per MT.

The prices of corn on CBOT were similar to last week’s close at $162.27 and $166.36 per MT for March and May delivery respectively. One of the reasons being attributed is the seasonal holidays, which keep the business at lower ebb.

The freight market has remained subdued this week in the US, due to the holiday season. The US-Gulf – Japan index was $23 per MT, PNW-Japan was $13, also US Gulf – Egypt for 55000 ton was $13 per MT as per latest report. The delivered value of corn to Egypt would be in the range of $198-200 per MT.

*** The information provided in this report has been derived from various sources, which are believed to be reliable and accurate but can not be guaranteed. All market data is subject to change in tandem with market conditions. Please obtain market updates and reconfirm all values before making any trading decisions based on the above data.